Bull of the Day: Nvidia (NVDA)

Nvidia Company OverviewZacks Rank #1 (Strong Buy) stock Nvidia (NVDA) is the world’s most important artificial intelligence company. Before the recent artificial intelligence revolution took hold with the launch of OpenAI’s ChatGPT, Nvidia was a pioneer in PC graphics for video games. However, in the early 2000s, Nvidia’s GeForce Series graphic cards unexpectedly unlocked their graphic process units (GPUs) for scientific computing, setting the stage for the AI revolution. Today, and with several iterations under its belt, Nvidia has become essential to the AI revolution. Its powerful GPUs are lightyears ahead of the competition and are the foundation of the tech stack needed to train AI and large language models (LLMs).AI: The Largest Infrastructure Buildout in HistoryLast week, Jensen Huang, Nvidia’s iconic CEO, delivered some noteworthy comments at the World Economic Forum (WEF) 2026 in Davos, Switzerland. First, Huang outright dismissed bubble fears, citing rising spot prices (even for older GPUs) and the extreme difficulty of renting them. Meanwhile, although “hyperscalers” like Amazon (AMZN), Alphabet (GOOGL), and Microsoft (MSFT) have already spent hundreds of billions of dollars on AI investments, Huang predicts trillions of dollars are in the pipeline, ready to support the latest and most powerful AI models.Wall Street analysts appear to be in lockstep with Huang’s predictions. Zacks Consensus Analyst Estimates suggest that NVDA revenue and EPS will each soar by more than 50% in 2026 and continue into 2027.Image Source: Zacks Investment ResearchNvidia: Blistering Growth at a Reasonable PriceNvidia shares peaked in October (as of now) and have moved sideways. However, the company’s fundamentals have only become stronger. The result? Nvidia’s valuation metrics, such as its price-to-sales ratio, have retreated dramatically, making the stock attractive to a wider swath of Wall Street institutions, including those that focus on valuations. NVDA, which had a P/S of 200x in 2023, now has a P/S of just ~24x.Image Source: Zacks Investment ResearchAI Will Expand to New Verticals in 2026Large language models and chatbots like OpenAI’s “ChatGPT” and Alphabet’s “Gemini” provided Wall Street investors with proof of concept for the AI revolution. However, chatbots are merely the tip of the iceberg. Jensen Huang referred to physical AI and robotics as a “once-in-a-generation opportunity.”  Meanwhile, Tesla (TSLA) CEO Elon Musk has repeatedly predicted that the company’s upcoming “Optimus” humanoid robot will be its largest product to date and potentially the best-selling product ever. While Musk and Huang’s bold statements may seem unrealistic, fading their opinions has been perilous. Finally, AI will begin to move into the application layer as complex AI models integrate into and disrupt the legacy software business. Nvidia Inks Deal to Sell Chips to ChinaNvidia has received approval to sell its H20 AI chips in China after signing a deal with the U.S. government. This marks a significant development for the company’s growth prospects. Under the terms of the agreement, the company will pay 15% of total revenues from H20 sales in China to the U.S. government. While this revenue-sharing condition may slightly impact margins, the deal opens a valuable door to one of the largest AI markets globally. The AI boom in China, driven by large tech companies like Baidu (BIDU) and government-backed projects, could create steady demand for H20 chips. Bottom LineNvidia’s transformation from a gaming pioneer to the bedrock of the global AI revolution has solidified its future growth. With demand growing and AI verticals broadening, Nvidia is well-positioned to maintain its AI dominance.Zacks Names #1 Semiconductor StockThis under-the-radar company specializes in semiconductor products that titans like NVIDIA don't build. It's uniquely positioned to take advantage of the next growth stage of this market. And it's just beginning to enter the spotlight, which is exactly where you want to be.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $971 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amazon.com, Inc. (AMZN): Free Stock Analysis Report Microsoft Corporation (MSFT): Free Stock Analysis Report NVIDIA Corporation (NVDA): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks